Inspired by the New York Times bestselling authors’ book “DECISIVE: How to make better decisions” (Heath and Heath, 2013), I will apply the WRAP model to the world of internal auditing. While internal auditors are not the decision maker for what the implementation of remediating actions is concerned, nonetheless, they are taking many decisions regarding their processes and outcomes.
Along the acronym WRAPS *), I will share my perspective on how to improve such decisions when seeking to render effective internal audit services. Thereby, I will, among other aspects, focus on the challenges of “narrow framing” (“Widen Your Options” is recommended) and “overconfidence” (“Prepare to be Wrong” is recommended).
My perspective is based on over 25 years of senior management experience in global organizations and my dive into the world of academia in parallel to my full-time job, performing empirical research about internal audit, too.
*) S added
5. Self-images of auditors: you have a choice !
5
Police
Consultant
Doctor
Servant
Superman/
-woman
Trusted Advisor
6. Trusted Advisor
6
“A trusted advisor is one of the first people you turn to when
you have a decision to make, need feedback, or just need
an honest appraisal of a situation. It is someone with whom
you can freely share information; someone who can help
you analyze the current situation; someone who will be
honest; and someone who will provide valuable, critical,
and constructive advice in times of need.“
(Mike Jacka, 2019)
Source:Jacka,Mike(2019),TryingtoDefineTrustedAdvisor,InternalAuditor,April
[Info] Bonner 2008, p.2:
Judgement: “forming an idea, opinion …“
Decision: “making up one‘s mind about the issue at hand and taking a course of action“
7. Description of Presentation: WRAPS
Inspired by the New York Times bestselling authors’ book
“DECISIVE: How to make better decisions” (Heath and
Heath, 2013), I will apply the WRAP model to the world of
internal auditing. While internal auditors are not the decision
maker for what the implementation of remediating actions is
concerned, nonetheless, they are taking many decisions
regarding their processes and outcomes.
Along the acronym WRAPS *), I will share my perspective
on how to improve such decisions when seeking to render
effective internal audit services. Thereby, I will, among other
aspects, focus on the challenges of “narrow framing” (“Widen
Your Options” is recommended) and “overconfidence”
(“Prepare to be Wrong” is recommended).
My perspective is based on over 25 years of senior
management experience in global organizations and my dive
into the world of academia in parallel to my full-time job,
performing empirical research about internal audit, too.
7 *) S added
9. Narrow framing Widen Your Options
9
• “Whether or not” decisions should set off warning bells, there are “shades of grey” (in most cases).
Beware that analytical, concluding thinking has its limits, applying “either or” categories and ignoring
shades of grey. Especially, in complex cases it may happen that important information emerge late. Don’t
jump to conclusions.
• Don’t let “independence” (ref. IPPF 2017, Attribute Standard 1100) be in the way to help your organization
to improve / transform. There is nothing wrong with internal auditors being a “helper” to the business.
• Beware misuse of checklists (esp. when routinely applied). Checklists may easily get in the way of a true
dialogue, and impair adaptive auditing.
• Consider using a variety of reporting formats, incl. assurance, advisory, incident & memo etc. Say what you
have to say timely, and use the adequate mode of communication whatever suits best.
• Put your findings into the organizational context for internal audit is contextually bound.
11. Confirmation bias Reality-Test Your Assumptions
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• My genesis, education and experiences determine how I view the world. Since there
is the tendency to seek and overweight confirming evidence, seek out people we
knew would disagree with us; interpret criticism as a noble function.
• Since groups usually make better judgements than individuals, particularly when
there is diversity of thought and experience, seek continuous dialogue with auditees,
local management, and senior/top management (as adequate) all along the way
when carrying out an internal audit, in the prep-phase, and while on-site. Benefit
from others’ perspectives and experiences.
• Switch from arguing to analyzing, for example, when asking “what would have to be
true for this option to be the right answer”.
13. Short-term emotions Attain Distance Before Deciding
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• Distinguish mission-critical tasks from things that are important but not core.
Address the “so what” question. Don’t water impact through plethora of findings and/or
over-dramatizing. Consider 10/10/10 rule.
• Let the audit report emerge while carrying out the field work, keep the stakeholders current.
Solidify and align key issues with stakeholders prior to the closing meeting.
• Reflect upon how to handle people you find disagreeable (who may or may not like
“auditors”/”you”), and, equally important, how to handle people you find agreeable.
Disagree without becoming disagreeable.
• Base audit findings on factual criteria and evidence. Control personal bias. No favor.
Manage your fear. Help to create “psychological safety” (Amy C. Edmondson) in the
workplace.
15. Overconfidence Prepare to be Wrong
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• Seek first to understand, then to be understood. Listen - really listen – to what
people say (ref. latin “audire”). “Two ears and one mouth …”
• People (including internal auditors) generally overestimate their judgement abilities.
Fight the “know-it-all”, the “jack-of-all-trades” trap; from #knowitall to #learnitall.
Involve specialists when needed. Long tenure can worsen the #knowitall-problem.
• Positioning of internal auditing is key …
17. Farmer as suggested New Metaphor for auditors
Key attributes:
• Has little or no formal authority
• Works indirectly; sows the seeds
• Humble; open minded; asks questions
• Focuses on strengthening things
• Positive associations like growth, harvest, nourish,
take care of, change of seasons, waiting etc.
• Very respectful towards nature
Relationship to others:
• Cares about good conditions to grow
Culture:
• Result-driven and outcome-focused
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Source:Sarens,G.,Lenz,R.&Decaux,L.(2016),
InsightsIntoSelf-ImagesofInternalAuditors,EDPACS,54:4,1-18